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SoftBank's US$100B Vision Fund ramps up investments in Asia


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SoftBank's US$100B Vision Fund ramps up investments in Asia

The US$100 billion private equity and venture capital arm of Japan's SoftBank Group Corp. is increasingly focusing on Asia as it seeks to expand its global portfolio despite the bulk of its investments being in U.S. and Canadian companies.

SoftBank Vision Fund, which is principally backed by investors from Saudi Arabia and the United Arab Emirates and primarily invests in technology startups globally, had invested US$27.10 billion, amounting to fair value of US$32.50 billion, as of June.

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The majority of Vision Fund's investments were made in the United States and Canada with 22, followed by the Asia-Pacific region with 16, Europe with two and Latin America/the Caribbean with one.

However, this represents an increase in investments in Asia-Pacific since November 2017 when Vision Fund had a total of eight investments in the region; three in China, four in India and one in Singapore.

Over half of Vision Fund's top 10 investments by amount raised to date were Asia-based, according to data compiled by S&P Global Market Intelligence.

They include China-headquartered Didi Chuxing Technology Co. Ltd., which topped the table with US$19.07 billion; Shanghai Lazhasi Information Technology Co. Ltd., which ranked third with US$3.35 billion; Guiyang Huochebang Technology Co Ltd raised US$2.28 billion; WeWork China and PingAn Medical and Healthcare Management. India-based ANI Technologies Private Ltd. also made it on to Vision Fund's top 10 investments by amount raised.

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Most recently, Vision Fund said it plans to invest in China-based ZhongAn Online P & C Insurance Co. Ltd. subsidiary ZhongAn International under a shareholder agreement and will reportedly lead a funding round of at least US$3 billion for Chinese e-commerce giant Alibaba Group Holding Ltd., which is raising the funds to support the merger of its food delivery units and Koubei.

Vision Fund and SoftBank's smaller Delta Fund have contributed significantly to the group's overall operating income, reaching US$2.21 billion in June.

The combined operating income of Vision Fund and Delta Fund accounted for 33.6% of SoftBank Group's overall operating income in the second quarter of 2018. In the same period a year ago, the funds' operating income accounted for 22.0% of the Japanese technology and telco's operating income.

On a quarter-over-quarter basis, Vision Fund and Delta Fund's combined operating income grew from US$611.4 million to US$2.21 billion. The leap was largely driven by its first public divestment — namely the sale of its stake in Indian e-commerce company Flipkart India Pvt. Ltd. in May — and the increase in fair value of WeWork.

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